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ikolkyo
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Boeing setting up new unit "Boeing Avionics"

Mon Jul 31, 2017 10:54 pm

Boeing, on new drive to boost substantially its income from aftermarket services, is actively reversing its yearslong course of extensive outsourcing.

In the latest sign of a new approach, Boeing announced internally Monday it is setting up a new in-house unit called Boeing Avionics to “pursue the development and production of avionics and electronics systems.”

Avionics are the core electronics used to manage aircraft systems including flight controls, communications, navigation, sensors and warning systems, and flight deck displays.

In a company memo to employees, Boeing chief executive Dennis Muilenburg referred to the move as a “strategy to build targeted vertical capability.

That’s business-speak for a company doing more of the work itself rather than handing it off to outsiders, and a term that must worry current systems suppliers such as Rockwell Collins and Honeywell — which may get less avionics work on Boeing’s next new airplane.”


What Boeing plans to do with its new unit

It will “focus on avionics systems such as those designed for navigation, flight controls, information systems and other core avionics” and will develop such systems for future airplanes, targeted for entry into service in the next decade.


http://www.seattletimes.com/business/bo ... -controls/
 
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Boeing778X
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Re: Boeing setting up new unit "Boeing Avionics"

Mon Jul 31, 2017 11:36 pm

Touched on a little bit in the 797 thread.

I think it would be great to develop avionics in house.
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BoeingGuy
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Re: Boeing setting up new unit "Boeing Avionics"

Mon Jul 31, 2017 11:57 pm

Good move. Boeing used to have an Avionics unit. Good old Harry Stoneciper decided Boeing could save money by outsourcing it. True to that mentality, it cost more and took longer to get the same equipment that it did when it was in house.
 
KFLLCFII
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 1:37 am

BoeingGuy wrote:
Good move. Boeing used to have an Avionics unit. Good old Harry Stoneciper decided Boeing could save money by outsourcing it. True to that mentality, it cost more and took longer to get the same equipment that it did when it was in house.

Do you know approximately when that cutover to outsourcing was?
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airtechy
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 2:11 am

This should make Collins and Honeywell....and others happy. NOT.
 
cpd
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 2:18 am

airtechy wrote:
This should make Collins and Honeywell....and others happy. NOT.


They could get some anti-trust action taken against Boeing to prevent Boeing from doing their own avionics - it would be anti-competitive. Sort of like IE being bundled with Windows and running by default. :D
 
dtw2hyd
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 2:22 am

Just acquire avionics businesses from both of Honeywell and Rockwell Collins and have a post-it note "Don't hire Scott Forstall". Boeing will do just fine.
 
airzona11
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 2:45 am

A friend of mine @ Boeing has been working in what is now this division. Seems like a logical progression as they turn more and more to applications and mobile apps that support their aircraft operation.
 
BoeingGuy
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 3:34 am

KFLLCFII wrote:
BoeingGuy wrote:
Good move. Boeing used to have an Avionics unit. Good old Harry Stoneciper decided Boeing could save money by outsourcing it. True to that mentality, it cost more and took longer to get the same equipment that it did when it was in house.

Do you know approximately when that cutover to outsourcing was?


2003, as stated in the linked Seattle Times article.
 
kabq737
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 4:34 am

BoeingGuy wrote:
KFLLCFII wrote:
BoeingGuy wrote:
Good move. Boeing used to have an Avionics unit. Good old Harry Stoneciper decided Boeing could save money by outsourcing it. True to that mentality, it cost more and took longer to get the same equipment that it did when it was in house.

Do you know approximately when that cutover to outsourcing was?


2003, as stated in the linked Seattle Times article.

Now I'm a little confused. I know that for example the MCP in the early 737 NGs was built by Honeywell and the Autopilot in the 737 Jurassic was built by sperry. Doesn't this count as outsourcing? These both occurred before 2003. I'm sure there's an explanation I'd just like to clarify.
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Aither
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 5:10 am

It's like in the car industry, took years before they realized they outsourced the profits more than they outsourced the costs. It's going to take a decade to re-develop the skills in house.
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kanban
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 5:10 am

While Harry did initiate some outsourcing but avionics wasn't part of it, this area has been back and forth over the last 60 years, Boeing got out of the business because 1) it wasn't a prime path (official version) 2) because they had endless quality and production issues and could not compete on those issues as well as price(real cause). basically the wheel has turned again .. they also had a computing division that was always late with substandard products. but since we don't use punch cards anymore, maybe they'll try that.
 
Manta
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 10:38 am

Does this mean Boeing will bring Connexion or BBSN back to life or are they going to leave wifi up to the current market players?
 
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Channex757
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 10:53 am

I can see this as being a longterm project. Boeing can't just set up and all of a sudden pump out modules. They need to rebuild the skills, and specifically work with people onboard who understand patents which competitors will have filed.

The ideal situation would be to bring in a partner. Set up Boeing Avionics and then sell half the company to an existing big player. That way they get access to a knowledgebase straight away and can build from there. The payoff will be that Boeing can produce avionics that are totally to their own requirements and support them for decades afterwards, which is where the money is.
 
frmrCapCadet
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 2:36 pm

Channex757 wrote:
I can see this as being a longterm project. Boeing can't just set up and all of a sudden pump out modules. They need to rebuild the skills, and specifically work with people onboard who understand patents which competitors will have filed.

The ideal situation would be to bring in a partner. Set up Boeing Avionics and then sell half the company to an existing big player. That way they get access to a knowledgebase straight away and can build from there. The payoff will be that Boeing can produce avionics that are totally to their own requirements and support them for decades afterwards, which is where the money is.


Several years ago a retired(?) Boeing worker wrote in his book that outsourcing huge parts of a project also outsourced control and profits for updating those parts. The outsourcers might very well have good reasons not to update, and somewhat had the upper hand when negotiating. Partnerships may be a good way to go.
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dtw2hyd
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 2:47 pm

frmrCapCadet wrote:
Several years ago a retired(?) Boeing worker wrote in his book that outsourcing huge parts of a project also outsourced control and profits for updating those parts. The outsourcers might very well have good reasons not to update, and somewhat had the upper hand when negotiating. Partnerships may be a good way to go.


In traditional outsourcing model, Boeing pays and owns both the product and intellectual property. The vendor is left with skilled workforce.

In recently failed risk sharing "partnership" model, Boeing ended up paying the partners to save the program, and got nothing in return.

So partnership may have looked fancy on paper but didn't workout the way it is supposed to. At least for now.
 
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smithbs
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 2:49 pm

Channex757 wrote:
I can see this as being a longterm project. Boeing can't just set up and all of a sudden pump out modules. They need to rebuild the skills, and specifically work with people onboard who understand patents which competitors will have filed.

The ideal situation would be to bring in a partner. Set up Boeing Avionics and then sell half the company to an existing big player. That way they get access to a knowledgebase straight away and can build from there. The payoff will be that Boeing can produce avionics that are totally to their own requirements and support them for decades afterwards, which is where the money is.


Some Boeing offices have been working in this direction for some time, so I suspect this is a public announcement to confirm what has been brewing in-house for a couple years. Even then, there is a long way to go in order to get where Rockwell and Honeywell are with their systems.

Bringing on - or simply absorbing - a useful partner would help. Maybe spawn off a joint company that is owned 50/50 between Boeing and a good avionics player. It's happened with engines, why not avionics?
 
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Channex757
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Re: Boeing setting up new unit "Boeing Avionics"

Tue Aug 01, 2017 4:23 pm

smithbs wrote:
Some Boeing offices have been working in this direction for some time, so I suspect this is a public announcement to confirm what has been brewing in-house for a couple years. Even then, there is a long way to go in order to get where Rockwell and Honeywell are with their systems.

Bringing on - or simply absorbing - a useful partner would help. Maybe spawn off a joint company that is owned 50/50 between Boeing and a good avionics player. It's happened with engines, why not avionics?

I've got absolutely no doubt this is the case; presumably a quiet project they have been working on in order not to upset their existing supply chain partners and in addition start the lawsuits flying.

There is also the issue to get round of whether taking something in-house upsets any of the laws that originally saw Boeing and Pratt split off from each other. I personally can't see this as it's not any degree of being a monopoly as there are so many other established players such as Thales, Rockwell Collins and Garmin etc doing systems. One of those (particularly the last two) is likely to be in advanced negotiations over whether they can do a deal and build a new company from scratch.

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